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Paddy Power reports growth in all of its divisions

Bookmakers Paddy Power has reported slightly better than expected results for last year despite adverse sports results in the second half of the year.

The company said its revenues for the year to the end of December rose 17% to €745m, while profits before tax grew by 5% to €141m.

Paddy Power reported dividend growth of 13% to 135 cent per share for the year, with an 11% increase in the final dividend to 90 cent per share.

The company said it opened a record number of new shops last year - 57 in the UK and ten in Ireland.

Patrick Kennedy, the group's chief executive, noted growth in all of the company's divisions, with particularly strong growth online, which now delivers over three quarters of group profits.

He said that Paddy Power is positioned for growth and is investing accordingly, and looks forward to 2014 and beyond with confidence.

Paddy Power said its online operations continued to increase significantly with net revenue up 21% to €473m and active customers rising by 19% to 1.9 million. Its mobile net revenue jumped by 73% to €212m in the 12 month period.

But it noted that the second half of 2013 was the first time with both like for like stakes and revenue growth since 2007, contributed to its best ever year for amounts staked at €981m.

It said its estimated market share in the Irish retail market was over 38%, up from 35% in 2012.

Paddy Power's UK retail division saw operating profits drop by 9% to €13.9m, due to "headwinds" of €1.8m from a new gaming machine tax regime and €0.6m from unfavourable exchange rate movements.

Operating profits at its telephone operations fell by 0.3% to €2.5m and the company said the division continued to perform strongly relative to its competitors.

Paddy Power said its online division, excluding Australia, reported a 1% rise in operating profits to €73.5m, while total net revenue rose by 14% to €299.7m. The company said its online business continued to progress well in the very "large and attractive Italian betting market".

Its online Australian operations saw a 9% rise in operating profits to €33.5m with net revenue rising by 15% to €179.6m. It said it continued to take market share, with stakes up 25%, net revenue up by 31% and active customers increasing by over 30%.

"We continue to build out our industry leading penetration in mobile sports betting and eGaming: mobile net revenue powered ahead by 73% in 2013 and now accounts for over half of total online revenue," commented the company's chief executive Patrick Kennedy.

"Investment in mobile will continue to be significant in order to take advantage of our market leading position and avail of its exceptional growth potential," he added.

Mr Kennedy said that this year has started well from a turnover point of view with sportsbook stakes up 16%, although sports results have been mixed.

"We’re strongly positioned to benefit from the growth “hot spots” in our markets and are investing accordingly. As a consequence, we look forward to 2014 and beyond with confidence," he added.

The bookmaker said it had signed a new contract with the largest operator in Slovakia, a move that would not be significant to earnings but showed its strength in the business-to-business market.